TNCs: Human Rights responsibility

Almost forty years ago, given the then recently discovered importance of transnational corporations (TNCs), UN Economic and Social Council (ECOSOC) resolution 1908 (LVII) determined the need to negotiate a UN Code of Conduct of TNCs and created the United Nations Centre on Transnational Corporations (UNCTC). The Code was meant to establish a multilateral framework to define the rights and responsibilities of TNCs and host country governments in their relations with each other. Additionally, negotiations also started on specific aspects related to the activities of TNCs, on the global nature of their activities. With this background, negotiations focused on two different views, specific issues and a comprehensive instrument.

From the beginning, that not all countries had the same ideas and priorities regarding TNCs and their control. Clearly, developing countries wanted to protect themselves from any negative effects of the TNCs’ activities in their territories. On the other hand, developed countries felt their TNCs were doing fine with the existent regulation, mainly from the OECD, and therefore had no pressing interest in the establishment of a multilateral instrument on the topic.

After various attempts and different resolutions adopted on human rights and transnational corporations and other business enterprises, two main documents were released. First, the Norms on the Responsibility of Transnational Corporations and other Business Enterprises with regard to Human Rights were approved on August 13, 2003 by the UN Sub-Commission on the Promotion and Protection of Human Rights, through resolution 2003/16. Sadly, these norms were not adopted by UN member States, which made them become dead letter.

Second, the Guiding Principles on Business and Human Rights (UNGPs) were unanimously endorsed on resolution 17/4 of the Human Rights Council on June 16, 2011. The UNGPs, which encompass three pillars on how states and businesses should implement the principles, States’ duty to protect, corporate responsibility to respect and access to remedy, became the first initiative and document on the topic. Despite the great progress, the UNGPs have one main flaw and inconvenient: they are non-binding and strictly voluntary. This means that they have limited implementation, as it all depends on the States’ willingness to apply them, as the UNGPs depend on a request of adoption of national action plans. Additionally, this wilfulness makes the UNGPs almost ineffective towards the goal to achieve justice in what it refers to the Human Rights violations.

But the difficulties when making states apply the UNGPs proved that something else needed to be done. Hence, two countries, Ecuador and South Africa, endorsed a resolution which aimed to get a binding agreement on transnational corporations and their human rights responsibilities. But the question regarding the need of an internationally legally binding instrument persisted throughout the negotiation process. There are some considerations, but the strongest refers to the fact that at the moment, we have an unbalanced protection of TNCs in comparison to the high vulnerability the victims of human rights violations face. This is also related to another reason, the existing gaps in the international system in what it refers to internationally legally binding rules and obligations aimed at TNCs’ behaviour. There are innumerable instruments that regulate the level of protection TNCs receive, especially TBIs and FTAs, but all fail to focus on the responsibilities they should have when performing their activities. Furthermore, with common practice it has become clear that national or domestic regulations are not enough to regulate TNCs, as they tend to have special legislation aimed to their protection, as mentioned above. Finally, the existence of soft law instruments, like the UNGPs, relies, by principle, on the will of the parties to abide by them, which evidence shows does not apply often.

During the 26th session of the Human Rights Council in Geneva, resolution 26/9 was adopted with 20 votes in favour, 14 against and 13 abstentions, proving that the differences in positions remained given the fact that mostly developing countries supported the resolution, whereas developed voted against. It was decided that an open-ended intergovernmental working group on transnational corporations and other business enterprises (IGWG) with respect to human rights would be established. Its mandate would be “to elaborate an international legally binding instrument to regulate, in international human rights law, the activities of transnational corporations and other business enterprises”.

With this background the first meeting of the Open-ended intergovernmental working group on transnational corporations and other business enterprises with respect to human rights took place from 6 to 10 July 2015 at the Human Rights Council in Geneva. During this meeting, the principles and the scope, including concepts and nature in international law, of the legally binding instrument were discussed. Also, there were other topics considered, like the human rights that should be covered under the instrument, the obligations of the states to guarantee the respect of human rights by TNCs, including extraterritorial obligations, the enhanced responsibility, including prevention, mitigation and remediation, the legal liability of TNCs and other enterprises, and building national and international mechanism for access to remedy. The second meeting of the IGWG is expected to be held in 2016 and it will keep paving the long road of the elaboration of the international legally binding instrument and then the signature, adoption and entry into force.